Frequently Asked Questions
Q. How does the disability tax credit work in Canada?
A. If you are out of work because of a severe, long-term mental or physical disability, you may be eligible to receive up to $45,000 in a year. In order to apply to receive the tax credit, you must submit the Disability Tax Credit Form (T2201) to the Canadian Revenue Agency.
Q. Can I claim this tax credit for previous years?
A. Yes. We have helped many Canadians claim for previous years. Many Canadian aren’t aware of the Disability Tax Credit, which is why so many miss out on the opportunity to receive money from the government while suffering from a disability.
Q. Does the Disability Tax Credit expire?
A. Once you are approved for the Disability Tax Credit, you are automatically approved to receive it for future years. The Canadian Revenue Agency may look at your application to determine how long you are covered. If you are only approved for a few years (rather than unlimited years), you will need to reapply for the Disability Tax Credit.
Q. Where do I get the Disability Tax Credit Form (T2201) from?
A. You can obtain a copy of the T2201 form from the CRA’s website here:
Q. Can I qualify if my condition has improved?
A. If your disability was present continuously for a minimum of 12 months sometime in the last 10 years, then yes, you can still qualify for the Disability Tax Credit.
Q. Can you receive the Disability Tax Credit if you have never worked?
A. The Disability Tax Credit is meant to be a safety net for people who have paid federal taxes. However, if you have a family member who supports you and pays their taxes, then you can claim the Disability Tax Credit on that family members’ taxes.
Q. Do I qualify if my condition is not present all the time?
A. There are health conditions that produce persistent and continuous after-effects, even though the condition isn’t seemingly present. Qualifying for the Disability Tax Credit with a condition that is not always present depends on the severity of the after effects. It would help to consult a medical practitioner when applying for the Disability Tax Credit.
Q. Who qualifies for the Disability Tax Credit?
A. If you suffer from a severe impairment, you can qualify for the disability tax credit. The term ’severe impairment’ encompasses people who take an inordinate amount of time to perform essential activities or people who undergo life-sustaining therapy to allow the body to perform vital functions.
You can also qualify if you can prove that your physical or mental impairment is severe and prolonged.
Q. Do I file taxes if I receive the Disability Tax Credit?
A. YES. You will need to file taxes even if you get the Disability Tax Credit.
Q. How long does it take for my application to be processed by the CRA?
A. Once the CRA receives your application, you can expect to wait 4 – 10 weeks to learn the outcome of your application.
Q. How is the Disability Tax Credit paid?
A. The Disability Tax Credit is a tax deduction, which means the tax credit comes in the form of a reduced tax bill. If you become eligible to receive the tax credit, then the Revenue Service of Canada will calculate how much you are eligible to receive and subtract that amount from the money you would have paid in income taxes. You receive the money for the credit in your tax return.